ES Morning Update October 18th 2017


Well, the futures have decided to ride the blue rising trendline up instead of turning over the ball to the bears.  Not that this wasn't expected as we all know this market favors the bulls over the bears.  I do not know when this will end but it will end badly when it does as the rising volume is the lowest I've ever seen.  Yesterday on the SPY it barely had 27 million shares traded... that's insane!  A health bull market should have well over a 100 million so this is clear signs too me that it's running on fumes here.  But, it will continue to do so until everyone turns bullish and unfortunately there's still a lot of bears out there.  One bad news event could drop this market hard and fast but since "they" control the news we shouldn't expect that to happen until the market grinds up to whatever new high is needed to get everyone bullish.  Is it 2600, 2700... I just don't know the answer.  I'll only say that this 6 hour chart is bullish as the MACD's did finally cross back positive and are pointing up from the +2.5 area right now.  But I don't think it will go back up to +7.5 where the prior high was in early October.  I only expect a lower high while the market makes a higher high.  This would setup negative divergence on the futures and allow for a top to be put in.  When will this happen?  Good question, but from the looks of this chart it could continue rising another 1-2 days fairly easily I think.

Now this all assumes we continue up and don't lose the rising blue trendline, which looks to be the plan right now.  However, I don't see many ways to play this move to the upside (nor would I want too) as it's too slow for my blood.  The decay on call options wouldn't be worth the risk and then there's still some worry of a gap down some future morning.  It's pretty clear to me (from the extremely low volume on the SPY) that traders aren't playing this market right now.  They are sitting in cash or trying to pick a top and shorting it.  But the super low volume speaks for itself... it's just bot's playing ping pong with other bot's as traders just can't make money in a market so quiet and without much movement.  The charts look like the EKG of a deadman right now, so this market needs a shock to it to get the heart beating again as this life support is failing.  My thoughts for today are more of the same ol' grind with more extremely light volume.  Nothing to look at here folks, move along...